Jashwin Baijoo | Head | Strategic Engagement & Compliance | Tax Consulting SA | mail me |
Annual tax law amendments now require a Public Officer appointment immediately upon forming a company.
Recent updates to Section 246 of the Tax Administration Act, No. 24 of 2011 (TAA) took effect on 24 December 2024. These changes remove the one-month window for appointing a Public Officer. This amendment creates a critical shift for businesses across South Africa.
SARS steps in to make an appointment
Companies must now appoint an eligible Public Officer who meets the South African Revenue Service’s (SARS) suitability standards. SARS now holds the authority to designate a suitable Public Officer if a company fails to appoint one.
When the default hierarchical listing yields no positive result, SARS steps in to make an appointment. This change, though administrative, significantly impacts tax compliance and enforcement.
For multinational enterprises and South African companies, late or unsuitable appointments are no longer viable options. Non-compliance is no longer tolerated! If a company has not appointed a Public Officer, time is running out! Legislative compliance is now more stringent.
Here’s what you need to know:
- The best option is appointing a senior official in the company who resides in South Africa. If this is not possible, SARS must approve another suitable person.
- If no Public Officer is appointed, SARS considers the first eligible person in the company’s corporate hierarchy. This includes roles such as managing director, financial director, or company secretary.
- In an alternative to the hierarchy, SARS may designate any suitable person to serve as the Public Officer.
- If SARS finds the appointed Public Officer unsuitable, the company is deemed non-compliant with Section 246 of the TAA. The company must then appoint a new Public Officer within 21 business days.
These amendments show that non-compliance is not just a minor issue. SARS is tightening enforcement, and companies must take compliance seriously. This is not just a procedural update. SARS aims to close loopholes, strengthen oversight, and ensure accountability in tax affairs.
Fix your compliance or risk focus on SARS’ radar
Companies that have not appointed a Public Officer must act immediately. Follow this step-by-step action plan:
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Review eligibility
Ensure the appointed person meets SARS’ criteria. If no eligible person resides in South Africa, move to step two.
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Get SARS approval
Secure approval for another suitable person if no senior company officials are available in South Africa.
Public Officer appointment – stay ahead of regulatory changes
Always update SARS promptly on any Public Officer changes to maintain compliance. The new amendments to Section 246 of the TAA emphasise a crucial message. Compliance is no longer optional but essential for doing business in South Africa.
Appointing a Public Officer today helps businesses stay ahead of regulatory changes. Ignoring these requirements exposes businesses to unnecessary risks and legal challenges. The burden of compliance with South African tax laws has increased significantly.
Engaging specialists who understand SARS’ requirements ensures compliance while minimising operational disruptions. Take proactive steps to secure compliance and protect your company’s future growth.
